AMSC (NASDAQ:AMSC), a global solutions provider serving wind and
power grid industry leaders, today reported financial results for
its third quarter of fiscal 2016 ended December 31,
2016.
Revenues for the third quarter of fiscal 2016
were $27.1 million, compared with $25.8 million for the same period
of fiscal 2015. Revenues in both the Wind and Grid segments
increased year-over-year.
AMSC’s net loss for the third quarter of fiscal
2016 decreased to $2.8 million, or $0.20 per share, from $3.0
million, or $0.22 per share, for the same period of fiscal 2015.
The Company’s non-GAAP net loss for the third quarter of fiscal
2016 was $2.9 million, or $0.21 per share, which was improved
compared with a non-GAAP net loss of $4.9 million, or $0.36 per
share, in the same period of fiscal 2015. Please refer to the
financial table below for a reconciliation of GAAP to non-GAAP
results.
Cash, cash equivalents and restricted cash at
December 31, 2016 totaled $26.0 million, compared with $26.6
million at September 30, 2016.
“Revenues were seasonally stronger in our Wind
segment in the third quarter, while our Grid revenues continued to
achieve year-over-year growth,” said Daniel P. McGahn, President
and CEO, AMSC. “In the third quarter, we demonstrated significant
improvement in our operating results relative to the first and
second quarters of fiscal 2016, with positive operating cash flow
in the third quarter. We expect our revenues in the fourth
quarter of fiscal 2016 to be strong as well.”
Business OutlookFor the fourth
quarter ending March 31, 2017, AMSC expects that its revenues will
be in the range of $22.0 million to $26.0 million. The Company’s
net loss for the fourth quarter of fiscal 2016 is expected to be
less than $5.5 million, or $0.39 per share. The Company's non-GAAP
net loss (as defined below) is expected to be less than $5.0
million, or $0.36 per share. The Company expects a minimal cash
burn of less than $2.0 million in the fourth quarter.
Conference Call ReminderIn
conjunction with this announcement, AMSC management will
participate in a conference call with investors beginning at 10:00
a.m. Eastern Time today to discuss the Company’s financial results
and business outlook. Those who wish to listen to the live or
archived conference call webcast should visit the “Investors”
section of the Company’s website at http://www.amsc.com/investors.
The live call also can be accessed by dialing 888-240-1347
and using conference ID 6209539.
About AMSC (NASDAQ:AMSC)AMSC generates the
ideas, technologies and solutions that meet the world’s demand for
smarter, cleaner … better energy™. Through its Windtec™ Solutions,
AMSC provides wind turbine electronic controls and systems, designs
and engineering services that reduce the cost of wind energy.
Through its Gridtec™ Solutions, AMSC provides the engineering
planning services and advanced grid systems that optimize network
reliability, efficiency and performance. The Company’s solutions
are now powering gigawatts of renewable energy globally and are
enhancing the performance and reliability of power networks in more
than a dozen countries. Founded in 1987, AMSC is headquartered near
Boston, Massachusetts with operations in Asia, Australia, Europe
and North America. For more information, please visit
www.amsc.com.
AMSC, Windtec, Gridtec, and Smarter, Cleaner …
Better Energy are trademarks or registered trademarks of American
Superconductor Corporation. All other brand names, product names,
trademarks or service marks belong to their respective holders.
Forward-Looking StatementsThis press release
contains forward-looking statements within the meaning of Section
21E of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). Any statements in this release about our
expectations regarding anticipated financial results, strong
revenues in the fourth quarter and other statements containing the
words “believes,” “anticipates,” “plans,” “expects,” “will” and
similar expressions, constitute forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995. Such forward-looking statements represent management’s
current expectations and are inherently uncertain. There are a
number of important factors that could materially impact the value
of our common stock or cause actual results to differ materially
from those indicated by such forward-looking statements. These
important factors include, but are not limited to: A significant
portion of our revenues are derived from a single customer, Inox,
and shipments to Inox may not occur in the time frame we expect; We
have a history of operating losses and negative operating cash
flows, which may continue in the future and require us to secure
additional financing in the future; Our operating results may
fluctuate significantly from quarter to quarter and may fall below
expectations in any particular fiscal quarter; Our financial
condition may have an adverse effect on our customer and supplier
relationships; Our success in addressing the wind energy market is
dependent on the manufacturers that license our designs; Our
success is dependent upon attracting and retaining qualified
personnel and our inability to do so could significantly damage our
business and prospects; We rely upon third-party suppliers for the
components and subassemblies of many of our Wind and Grid products,
making us vulnerable to supply shortages and price fluctuations; We
may not realize all of the sales expected from our backlog of
orders and contracts; Our success depends upon the commercial use
of high temperature superconductor (“HTS”) products, which is
currently limited, and a widespread commercial market for our
products may not develop; Growth of the wind energy market depends
largely on the availability and size of government subsidies and
economic incentives; We have operations in and depend on sales in
emerging markets, including India and China, and global conditions
could negatively affect our operating results or limit our ability
to expand our operations outside of these countries; We face risks
related to our intellectual property; We face risks related to our
legal proceedings; and the important factors discussed under the
caption “Risk Factors” in Part 1. Item 1A of our Form 10-K for the
fiscal year ended March 31, 2016, and our other reports filed with
the SEC. These important factors, among others, could cause actual
results to differ materially from those indicated by
forward-looking statements made herein and presented elsewhere by
management from time to time. Any such forward-looking statements
represent management’s estimates as of the date of this press
release. While we may elect to update such forward-looking
statements at some point in the future, we disclaim any obligation
to do so, even if subsequent events cause our views to change.
These forward-looking statements should not be relied upon as
representing our views as of any date subsequent to the date of
this press release.
UNAUDITED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(In thousands, except per share
data) |
|
|
Three months ended December 31, |
|
Nine months ended December 31, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Revenues |
|
|
|
|
|
|
|
|
|
Wind |
$ |
18,248 |
|
|
$ |
17,229 |
|
|
$ |
36,822 |
|
|
$ |
48,976 |
|
Grid |
8,900 |
|
|
8,543 |
|
|
22,178 |
|
|
19,523 |
|
Total
revenues |
27,148 |
|
|
25,772 |
|
|
59,000 |
|
|
68,499 |
|
|
|
|
|
|
|
|
|
|
|
Cost of revenues |
22,107 |
|
|
19,263 |
|
|
50,992 |
|
|
55,758 |
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
5,041 |
|
|
6,509 |
|
|
8,008 |
|
|
12,741 |
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
Research
and development |
2,985 |
|
|
2,759 |
|
|
8,804 |
|
|
8,924 |
|
Selling,
general and administrative |
6,077 |
|
|
7,023 |
|
|
19,640 |
|
|
21,331 |
|
Impairment loss |
— |
|
|
— |
|
|
— |
|
|
779 |
|
Amortization of acquisition related intangibles |
39 |
|
|
39 |
|
|
118 |
|
|
118 |
|
Total
operating expenses |
9,101 |
|
|
9,821 |
|
|
28,562 |
|
|
31,152 |
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
(4,060 |
) |
|
(3,312 |
) |
|
(20,554 |
) |
|
(18,411 |
) |
|
|
|
|
|
|
|
|
|
|
Change in fair value of
derivatives and warrants |
101 |
|
|
(1,092 |
) |
|
667 |
|
|
409 |
|
Gain on sale of
minority interest |
325 |
|
|
2,511 |
|
|
325 |
|
|
2,511 |
|
Interest expense,
net |
(89 |
) |
|
(238 |
) |
|
(331 |
) |
|
(841 |
) |
Other income (expense),
net |
873 |
|
|
(20 |
) |
|
481 |
|
|
(1,189 |
) |
Loss before income tax
expense |
(2,850 |
) |
|
(2,151 |
) |
|
(19,412 |
) |
|
(17,521 |
) |
|
|
|
|
|
|
|
|
|
|
Income tax (benefit)
expense |
(82 |
) |
|
806 |
|
|
1,036 |
|
|
2,256 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(2,768 |
) |
|
$ |
(2,957 |
) |
|
$ |
(20,448 |
) |
|
$ |
(19,777 |
) |
|
|
|
|
|
|
|
|
|
|
Net loss per common
share |
|
|
|
|
|
|
|
|
|
Basic |
$ |
(0.20 |
) |
|
$ |
(0.22 |
) |
|
$ |
(1.49 |
) |
|
$ |
(1.52 |
) |
Diluted |
$ |
(0.20 |
) |
|
$ |
(0.22 |
) |
|
$ |
(1.49 |
) |
|
$ |
(1.52 |
) |
|
|
|
|
|
|
|
|
|
|
Weighted average number
of common shares outstanding |
|
|
|
|
|
|
|
|
|
Basic |
13,792 |
|
|
13,539 |
|
|
13,746 |
|
|
13,052 |
|
Diluted |
13,792 |
|
|
13,539 |
|
|
13,746 |
|
|
13,052 |
|
UNAUDITED CONSOLIDATED BALANCE
SHEET |
(In thousands, except per share
data) |
|
|
December 31,
2016 |
|
March 31, 2016 |
ASSETS |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and
cash equivalents |
$ |
25,063 |
|
|
$ |
39,330 |
|
Accounts
receivable, net |
15,863 |
|
|
|
19,264 |
|
Inventory |
19,442 |
|
|
|
18,512 |
|
Prepaid
expenses and other current assets |
3,097 |
|
|
|
5,778 |
|
Restricted cash |
795 |
|
|
|
457 |
|
Total
current assets |
64,260 |
|
|
|
83,341 |
|
|
|
|
|
|
|
Property,
plant and equipment, net |
45,114 |
|
|
|
49,778 |
|
Intangibles, net |
436 |
|
|
|
854 |
|
Restricted cash |
140 |
|
|
|
934 |
|
Deferred
tax assets |
115 |
|
|
|
96 |
|
Other
assets |
176 |
|
|
|
315 |
|
Total
assets |
$ |
110,241 |
|
|
$ |
135,318 |
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts payable and
accrued expenses |
$ |
18,354 |
|
|
$ |
23,156 |
|
Note payable, current
portion, net of discount of $47 as of December 31, 2016 and $42 as
of March 31, 2016 |
1,453 |
|
|
|
2,624 |
|
Derivative
liabilities |
2,560 |
|
|
|
3,227 |
|
Deferred revenue |
15,997 |
|
|
|
12,000 |
|
Total
current liabilities |
38,364 |
|
|
|
41,007 |
|
|
|
|
|
|
|
Note payable, net of
discount of $133 as of March 31, 2016 |
— |
|
|
|
1,367 |
|
Deferred revenue |
7,974 |
|
|
|
9,269 |
|
Deferred tax
liabilities |
63 |
|
|
|
63 |
|
Other liabilities |
47 |
|
|
|
63 |
|
Total
liabilities |
46,448 |
|
|
|
51,769 |
|
|
|
|
|
|
|
Stockholders'
equity: |
|
|
|
|
|
Common stock |
143 |
|
|
|
141 |
|
Additional paid-in
capital |
1,014,365 |
|
|
|
1,011,813 |
|
Treasury stock |
(1,371 |
) |
|
(881 |
) |
Accumulated other
comprehensive (loss) income |
(712 |
) |
|
660 |
|
Accumulated
deficit |
(948,632 |
) |
|
(928,184 |
) |
Total
stockholders' equity |
63,793 |
|
|
83,549 |
|
Total
liabilities and stockholders' equity |
$ |
110,241 |
|
|
$ |
135,318 |
|
UNAUDITED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(In thousands) |
|
|
Nine months ended December 31, |
|
2016 |
|
2015 |
Cash flows from
operating activities: |
|
|
|
|
|
|
|
Net
loss |
$ |
(20,448 |
) |
|
$ |
(19,777 |
) |
Adjustments to reconcile net loss to net cash used in operations:
|
|
|
|
Depreciation and amortization |
5,606 |
|
|
6,050 |
|
Stock-based compensation expense |
2,266 |
|
|
2,542 |
|
Impairment loss |
— |
|
|
746 |
|
Provision
for excess and obsolete inventory |
1,074 |
|
|
1,835 |
|
Write-off
prepaid taxes |
— |
|
|
289 |
|
Gain from sale of
minority interest investments |
(325 |
) |
|
(2,155 |
) |
Change in fair value of
derivatives and warrants |
(667 |
) |
|
(409 |
) |
Non-cash interest
expense |
127 |
|
|
290 |
|
Other non-cash
items |
(937 |
) |
|
694 |
|
Changes in operating
asset and liability accounts: |
|
|
|
Accounts
receivable |
3,213 |
|
|
(7,156 |
) |
Inventory |
(2,294 |
) |
|
3,288 |
|
Prepaid
expenses and other current assets |
2,283 |
|
|
5,800 |
|
Accounts
payable and accrued expenses |
(4,031 |
) |
|
(34 |
) |
Deferred
revenue |
3,598 |
|
|
198 |
|
Net cash
used in operating activities |
(10,535 |
) |
|
(7,799 |
) |
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Net cash
provided by investing activities |
357 |
|
|
4,856 |
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
Net cash
(used in)/provided by financing activities |
(3,657 |
) |
|
19,202 |
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents |
(432 |
) |
|
(312 |
) |
|
|
|
|
Net (decrease)/increase
in cash and cash equivalents |
(14,267 |
) |
|
15,947 |
|
Cash and cash
equivalents at beginning of year |
39,330 |
|
|
20,490 |
|
Cash and cash
equivalents at end of year |
$ |
25,063 |
|
|
$ |
36,437 |
|
RECONCILIATION OF GAAP NET INCOME (LOSS) TO NON-GAAP
NET INCOME (LOSS) |
(In thousands, except per share data) |
|
|
Three months ended December 31, |
|
Nine months ended December 31, |
|
2016 |
|
2015 |
|
2016 |
|
2015 |
Net loss |
$ |
(2,768 |
) |
|
$ |
(2,957 |
) |
|
$ |
(20,448 |
) |
|
$ |
(19,777 |
) |
Gain on sale of
interest in minority investments, net of tax effect
|
(325 |
) |
|
(2,354 |
) |
|
(325 |
) |
|
(2,354 |
) |
Stock-based
compensation |
613 |
|
|
708 |
|
|
2,266 |
|
|
2,542 |
|
Amortization of
acquisition-related intangibles |
39 |
|
|
39 |
|
|
118 |
|
|
118 |
|
Impairment loss |
— |
|
|
— |
|
|
— |
|
|
779 |
|
Consumption of zero
cost-basis inventory |
(478 |
) |
|
(1,543 |
) |
|
(1,118 |
) |
|
(3,612 |
) |
Change in fair value of
derivatives and warrants |
(101 |
) |
|
1,092 |
|
|
(667 |
) |
|
(409 |
) |
Non-cash interest
expense |
30 |
|
|
83 |
|
|
127 |
|
|
290 |
|
Tax effect of
adjustments |
77 |
|
|
|
— |
|
|
179 |
|
|
— |
|
Non-GAAP net loss |
$ |
(2,913 |
) |
|
$ |
(4,932 |
) |
|
$ |
(19,868 |
) |
|
$ |
(22,423 |
) |
|
|
|
|
|
|
|
|
Non-GAAP net loss per
share |
$ |
(0.21 |
) |
|
$ |
(0.36 |
) |
|
$ |
(1.45 |
) |
|
$ |
(1.72 |
) |
Weighted average shares
outstanding - basic and diluted |
13,792 |
|
|
13,539 |
|
|
13,746 |
|
|
13,052 |
|
Reconciliation of Forecast GAAP Net Loss to Non-GAAP
Net Loss |
(In millions, except per share data) |
|
|
Three months ending |
March 31, 2017 |
Net loss |
$ |
(5.5 |
) |
Stock-based compensation |
|
0.6 |
|
Consumption of zero-cost inventory |
|
(0.1 |
) |
Non-GAAP net loss |
$ |
(5.0 |
) |
Non-GAAP net loss per
share |
$ |
(0.36 |
) |
Shares outstanding |
|
14.0 |
|
|
|
|
|
Note: Non-GAAP net loss is defined by the
Company as net loss before stock-based compensation; amortization
of acquisition-related intangibles; consumption of zero cost-basis
inventory; non-cash interest expense; change in fair value of
derivatives and warrants; and other unusual charges, net of any tax
effects related to these items. The Company believes non-GAAP net
loss assists management and investors in comparing the Company’s
performance across reporting periods on a consistent basis by
excluding these non-cash, non-recurring or other charges that it
does not believe are indicative of its core operating performance.
The Company also regards non-GAAP net loss as a useful measure of
operating performance to complement operating loss, net loss and
other GAAP financial performance measures. In addition, the Company
uses non-GAAP net loss as a factor in evaluating management’s
performance when determining incentive compensation and to evaluate
the effectiveness of its business strategies.
Generally, a non-GAAP financial measure is a
numerical measure of a company's performance, financial position or
cash flow that either excludes or includes amounts that are not
normally excluded or included in the most directly comparable
measure calculated and presented in accordance with GAAP. The
non-GAAP measures included in this release, however, should be
considered in addition to, and not as a substitute for or superior
to, operating income, cash flows, or other measures of financial
performance prepared in accordance with GAAP. A reconciliation of
non-GAAP to GAAP net loss is set forth in the table above.
AMSC Contact:
Brion D. Tanous
AMSC Investor Relations
Phone: 424-634-8592
Email: Brion.Tanous@amsc.com
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